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A Year After Legalization, Pot Patchwork Prevails

Thu, 06/16/2022 - 11:52
While New York State’s 2021 Marihuana Regulation and Taxation Act allows people to grow up to six plants for their own consumption, it’s still technically illegal to grow your own since final regulations for home cultivation have not been established.
Carissa Katz

When it comes to local towns and villages opting in or opting out of New York State’s licensing opportunities under the 2021 Marihuana Regulation and Taxation Act, it’s pretty much a hodgepodge: East Hampton Village and Town are both out, the Town of Southampton is in — but not its villages. Southold and Shelter Island Towns opted out, as did Greenport Village, and Riverhead is moving ahead with local guidance for would-be operators of dispensaries and social-consumption spaces.

New York’s landmark legalization law empowered municipalities to decide by the end of 2021 whether to allow cannabis dispensaries or on-site consumption cafes, and data compiled by the Rockefeller Institute for Government in Albany shows that roughly half the counties or municipalities in the state opted in on one or the other. To the west, the Town of Brookhaven opted in with a catch: dispensaries and cafes are allowed, but only in industrial-zoned spaces.

Even as localities have done their part by opting in or out, legalization is in a state of liminality in New York while the Office of Cannabis Management acts to put regulatory muscle on the bones of the Marihuana Regulation and Taxation Act. For example, while the act allows individuals to grow up to six plants, it’s still technically illegal to grow your own. “We still do not have the final regulations or guidelines for home cultivation,” said David Falkowski, the owner of Open Minded Organics in Bridgehampton, one of the first licensed hemp farms in the state. More broadly, he said, “We are still so far away from this being a functioning law,”

Southampton Town Supervisor Jay Schneiderman said the town has been hashing out new zoning regulations and will likely wind up with a few pot-friendly zoning districts and lots of stipulations for dispensaries. They won’t be able to operate near schools, churches, playgrounds, or libraries, “and there will be all kinds of limits in terms of the size of the operation, there won’t be any displays, no exterior signage, no pot leaves or things like that,” he says.

The Town of Southampton opted in on dispensaries and social-consumption spaces, but its incorporated villages – Sagaponack, Southampton Village, Quogue, Westhampton Dunes, Westhampton Beach, and North Haven — opted out. Sag Harbor, which straddles the townships of East Hampton and Southampton, also opted out.

Southampton will allow pre-existing nightclubs or bars to convert from selling alcohol to selling cannabis (but not both), and Mr. Schneiderman said an entrepreneur could build a social-consumption nightclub — but that it’s unlikely because of permitting hurdles. “You could create one but it’s pretty tough, and it would be easier to take an existing bar or nightclub and convert it.”

The supervisor added that Southampton considered going the Brookhaven route and limiting pot businesses to industrial-zoned areas, but doing so would have validated a societal stigmatization of cannabis that the state is trying to unwind. The town allows adult-entertainment businesses, he noted, but only in its industrial zones, and treating cannabis as “something that we have to hide from society, as if it’s a bad thing,” would serve to perpetuate the stigma. Besides, there is not a lot of industrial-zoned land in town that would qualify.

The wild card here is the Town of East Hampton, which Mr. Falkowski anticipates will eventually get on board with the budding pot economy. “We’re going to start seeing municipalities slowly start to opt in based on local lobbying activities,” he said. There’s a lot of tax revenue at stake, and while East Hampton consumers will be permitted to grow, smoke, eat, and have pot delivered to their homes — the town won’t enjoy any tax revenues from pot businesses.

That was a driving force behind Southampton Town’s decision to opt in, said Mr. Schneiderman. “Opting out would not have decreased use in any way, it would have only decreased revenue, and any town resident outside of the [Shinnecock] Reservation would not have been able to participate in this economic opportunity. A lot of local people want to see if they can profit from legalization.”

The Shinnecock Nation isn’t subject to state licensing protocols and the town won’t be getting any tax revenue from sales on the reservation. “They are moving forward with their own dispensaries,” said Mr. Schneiderman, “and it’s likely that theirs will be up and running before the town’s.”

Mr. Schneiderman added that the law also allows for cannabis delivery services, “so any town or village that had a dispensary could bring product to Southampton without getting the revenues, which could be used to counter any adverse consequences from legalization — whether in mental health, increased police, whatever it might be.” He anticipates at least $1 million in yearly tax revenues. 

But the expected tax bonanza is a way off, as the state is only now issuing its first licenses, while the Office of Cannabis Management continues its work on the regulatory front. In the end, Mr. Schneiderman said Southampton will likely wind up with one or two dispensaries and/or social-consumption lounges, “but I can’t guarantee that. It’s really up to the state.”

Mr. Falkowski says he anticipates the Office of Cannabis Management will complete its work within a year, as he observed that the bureau “is just kind of piecemealing things,” on a host of devilishly detailed weed issues — from eco-friendly packaging, to guidance around public consumption, to rules governing growing and manufacturing cannabis and cannabis products.

The emerging protocols on the public consumption of legal weed are pretty basic: If you can’t smoke a cigarette in a particular location, you can’t smoke a joint there, either. The exception is, of course, that anyone is free to smoke cigarettes in their vehicle, but smoking pot in your car on the Napeague stretch could lead to hefty fines and jail time under the state’s robust driving-while-ability-impaired law.

In East Hampton, beach parking lots and egresses to the shoreline are already off limits to cigarette smokers, and the town recently passed an ordinance that outlawed smoking and vaping within 500 feet of a lifeguard stand while guards are on duty. Southampton is considering an ordinance that would ban smoking in public parks, including its lifeguarded beaches, North Sea Park, Red Creek Park, and elsewhere. “In some cases, entire parks are now listed as no-smoking parks,” Mr. Schneiderman said, “and that covers pot and cigarettes.” 

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